Links for Thursday, April 29, 2021

BUSINESS AND TECHNOLOGY:

• Tencent, ByteDance, JD, Didi, Meituan caught up in rectification of Big Tech
  China readies Tencent penalty in antitrust crackdown — sources / Reuters

China is preparing a substantial fine for Tencent Holdings as part of its sweeping antitrust clampdown on the country’s internet giants, but it is likely to be less than the record $2.75 billion penalty imposed on Alibaba earlier this month, two people with direct knowledge of the matter said…

The regulator has informed Tencent that it should expect a fine, give up exclusive music rights, and may even be forced to sell the acquired Kuwo and Kugou music apps, said the people.

• China orders Tencent, ByteDance to rectify financial operations / Bloomberg (paywall)
  “Units of JD.com Inc., Meituan and Didi were also among firms summoned to a meeting with several watchdogs including the central bank, which spelled out a raft of requirements including stricter compliance when listing abroad and curbs on information monopolies and the gathering of personal data.”
  No more regulatory blind eye for internet M&A / Caixin (paywall)
  “Since December, regulators fined 13 companies, including Alibaba, Tencent and Baidu, for failing to seek anti-monopoly approval for their internet-related investments and acquisitions.”
• Following Xi, Meituan and Ele.me pledge to treat delivery drivers better
  Chinese takeout giants Meituan, Eleme say they will treat delivery men better / Yicai
  China’s two largest takeout platforms have agreed to improve working conditions for their delivery drivers after a flurry of public criticism regarding unreasonable delivery time targets, poor pay, and long working hours.
  On a tour of Guangxi on Tuesday, top leader Xí Jìnpíng 习近平 vowed to protect “the legitimate interests of truck drivers, couriers, and food delivery riders.”
• Alibaba exits real estate business?
  Alibaba abandons real estate JV, moves stake to JV partner E-House / Yicai
  “Chinese ecommerce giant Alibaba Group Holding is transferring its 85 percent stake in the online real estate joint venture that it set up last year with E-House China Enterprise Holdings to the property sales firm.”
• Online tutoring cull
  新东方在线集中裁员；石头科技自研多线激光雷达，或可用于自动驾驶汽车 / Late Post
  New Oriental Education, one of China’s largest offline and online tutoring providers, has started to lay off teachers in the past month. About 20% of the teachers in the middle school division are leaving.
  There is intensifying scrutiny from Beijing against online tutoring, which top officials, including Xí Jìnpíng 习近平 himself (in Chinese), believe is contributing to a decline in children’s mental health. On Sunday, Beijing regulators fined New Oriental, GSC Techedu, and two other tutoring services $80,000 each for misleading marketing practices.
• Booming smartphone sales in China
  Smartphone recovery continues with shipments up 25.5% in the first quarter of 2021 / IDC
  Global smartphone shipments for the first quarter of 2021 increased by 25.5% to 346 million units. China’s numbers were up 30% even though Huawei, which scaled back its smartphone business in response to U.S. sanctions, saw its shipments fall by 70%, per Nikkei (in Japanese).
• Batteries for residential energy storage systems and electric bikes
  CATL’s shares rise after $2.1 billion deal to make mid-sized batteries with TDK’s unit / Yicai
  “The Chinese firm and Amperex Technology will invest CNY14 billion ($2.1 billion) to set up two joint ventures to tap into the sector of medium-sized batteries.”
• New energy and smart vehicles
  Self-driving truck startup plus to develop natural gas-powered vehicle with U.s. engine-maker / Caixin (paywall)
  “Self-driving truck startup Plus has announced a partnership with U.S.-based engine-maker Cummins to develop an autonomous truck powered by natural gas.”
  Why are Chinese electric-car makers flocking to Norway? / Caixin (paywall)
  “Norway’s openness to foreign car brands, high EV uptake and robust climate pledges make it the perfect first stop.”
  Baidu will offer first paid robotaxi service in China next month, letting people hail rides without drivers / SCMP (paywall)
  Huawei deepens dive into EVs, seeks control of small automaker — sources / Reuters
  戴姆勒、沃尔沃计划在氢动力卡车方面联手 / 36Kr
  Daimler and Geely-owned Volvo team up on hydrogen cars.
• The end of Tesla’s China honeymoon
  Tesla’s China moment / ZoZo Go
  “Here is the bitter irony for Tesla: As sales, supply chains and original engineering increase inside the PRC, Tesla’s leverage will continue to slide.”
• Banks and bonds battle bubbles
  China’s biggest banks post profit gains below 3% amid curbs / Bloomberg (paywall)
  “The central bank last month asked major lenders to curtail loan growth for the rest of this year on concerns of bubble risks, people familiar with the matter have said.”
  China’s surprise bond reprieve raises fears of crunch in May / Bloomberg (paywall)
  “‘Happening later than expected means there will be more buildup,’ said Xing, who forecasts local government debt issuance and annual tax settlements will drain a combined 800 billion yuan ($124 billion) in May, resulting in liquidity falling 1.6 trillion yuan short of what will be needed.”
• Animal testing for cosmetics: European firms welcome lifting of requirements
  From May 1, animal test of imported non-special cosmetics waived / European Chamber of Commerce, China
  Many European cosmetics are tested using “cellular models…based on human cell designs” that are “more relevant to human risk assessment and thus are better predictors of human responses to the effects of products and ingredients.” They were previously required to get additional animal tests to qualify for China’s import rules.
• Forced labor in solar supply chain
  U.S. solar industry unveils guidelines to free supply chain of forced labor / Reuters

SCIENCE, HEALTH, AND THE ENVIRONMENT:

• The new National Disease Prevention and Control Administration
  China Forms New Super Agency to Oversee Disease Prevention and Control / Caixin (paywall)
  “China has established a new vice-ministerial level agency to oversee the country’s vast disease control and prevention apparatus and to plug gaps in the public health system exposed by last year’s coronavirus outbreak.”
• Binge-eating livestreamers targeted with new law
  Passage of Food Waste Bill Inscribes Clean Plate Campaign Into Law / Caixin
  “The bill states that restaurants will be fined up to 10,000 yuan for “inducing or misadvising” customers to order excessive amounts of food, producers will face a charge of up to 50,000 yuan for wasting food, and internet users could be fined up to 100,000 yuan for posting binge eating videos online.”
  Last year on The China Project: Chinese authorities take aim at binge-eating livestreamers as food prices spike.
• How the U.S. gave up on competing with China’s vaccine diplomacy
  Biden’s COVID team split over decision to send vaccine doses abroad / Politico
  “The debate came to a head in early March when a cross-agency group focused on the Covid-19 response that included top staffers at HHS, CDC and USAID pushed the administration to begin donating potentially hundreds of millions of doses over the next five months…top White House aides rejected that recommendation over concerns that the domestic stockpile was not large enough yet — and that the optics of sending doses abroad during a big push to make vaccines more available to U.S. citizens.”
  Western powers have lost the vaccine diplomacy battle / Economist Intelligence Unit
  “Western countries will only engage in vaccine diplomacy only later this year. This will likely be too late to catch up with that of Russia and China, which are winning the public relations battle.”
• Steel industry reform
  China cuts steel import tariffs to push industry to improve / AP
  Lauri Myllyvirta on Twitter: “Very impressive emissions reduction targets being put in place for China’s steel industry: sector CO2 emissions to peak before 2025 and to fall 30% from the peak by 2030.”
• Vaccine distribution and diplomacy
  Vaccinating more than anywhere else, China still needs to speed up / Reuters
  Chinese companies considers mixing vaccines, booster shots / AP
  Morocco, Egypt, and Zimbabwe Are the Top Recipients of Chinese Vaccines in Africa / China-Africa Project
  Hungary eyes vaccine passport deals, holds talks with China / Reuters

POLITICS AND CURRENT AFFAIRS:

• Statistics bureau contradicts FT report on population trend
  China’s population increased in 2020, government says / WSJ (paywall)
  “The National Bureau of Statistics didn’t elaborate, saying only that detailed data would be released in its coming census report, according to the one-sentence statement [in Chinese] published on its website.”
  Context on The China Project: China’s demographic crisis ‘faster and bigger’ than thought, census results to show population peaked: FT
• Biden, Blinken talk tough
  Biden’s speech calls for U.S. to take on China and Russia / NYT (paywall)
  China among a pack of economic competitors ‘closing in fast’ on the U.S., Biden says / Bloomberg via Caixin
  Antony Blinken defends Trump-era moves against Chinese media outlets in the U.S. / SCMP (paywall)
  “U.S. Secretary of State Antony Blinken on Wednesday defended the measures that his predecessor Mike Pompeo took against the American operations of Chinese media outlets, calling them out for ‘undermining democracy’.”
  China warns U.S. against imposing democratic ideals after Biden speech / AFP via HKFP
  China ‘will not accept’ U.S. challenges to its Communist politics, leaders / SCMP (paywall)
• Blinken on Chinese finance and labor in Africa
  Blinken warns of Chinese debt traps and imported labor in Q&A with African youth / China-Africa Project
  “United States Secretary of State Antony Blinken resuscitated widely debunked theories about debt traps and imported labor to warn African countries about the dangers of working too closely with Beijing…His comments on Tuesday provide the most detailed insight to date into how the Secretary understands, (or doesn’t understand), the issue of Chinese engagement on the continent.”
  Debunking the Chinese unskilled labor myth in Africa / China-Africa Project
  The Chinese Foreign Ministry responded to U.S. Secretary of State Antony Blinken’s webinar where he talked China-Africa / China-Africa Project
• Australia-China relations even more tense, if you can believe it
  ‘Fuel on the fire’: war of words between Australia and China stokes tension / Guardian
  Australia’s China debate gets more rancorous with harassment, threats and lawsuits / SCMP (paywall)
  China tells Australia to abandon its ‘Cold War mentality’ while criticising our politicians / Australian ABC
  China-Australia relations: as wine exports continue piling up at Chinese ports, Australian officials explore options / SCMP (paywall)
  China labels India, Australia, Japan supply chain plan as ‘artificial’ and ‘unfavorable’ to global economy / SCMP (paywall)
  “Australia, India and Japan formally launched the Supply Chain Resilience Initiative (SCRI) on Tuesday after the plan was first discussed informally in July at the height of the pandemic…China was never officially mentioned, but the reliance on it as source of critical medical supplies and finished goods during the outbreak was clearly a key motivation for the initiative.”
  China is drinking barely a drop of Australian wine after 200% tariffs / Bloomberg (paywall)
• Merkel’s balancing act
  Merkel calls for deeper cooperation with China on COVID Vaccines / Bloomberg (paywall)
  Germany’s Merkel presses China for human rights dialogue / AP
• Hong Kong exit bans coming?
  Hong Kong passes new immigration law that could enable China-style exit bans / CNN
  “Under the new Hong Kong regulations, which come into force on August 1, the city’s immigration director will gain new powers to stop people entering or leaving the city, without a court order, including banning airlines from carrying certain passengers.”
  U.S. sounds alarm over fears of China-style ‘exit bans’ in Hong Kong / AFP via HKFP
  COVID-19: Hong Kong will consider anything China demands to resume cross-border travel, leader Carrie Lam says / HKFP
  Hong Kong bans Victoria Park’s Tiananmen Massacre vigil again, citing COVID-19 restrictions / HKFP
• South China Sea and other maritime hot spots
  Vietnam says it opposes China’s fishing ban that starts May 1 / Bloomberg (paywall)
  China’s new maritime law fines ships that violate its waters / Nikkei Asia (paywall)
  Taiwan’s new coast guard flagship to counter China’s ‘grey-zone’ threat / Reuters
  China urges U.S. to restrain frontline forces in nearby seas / Reuters

SOCIETY AND CULTURE:

• Fending off the “urban management officers”
  New film turns the tables on China’s infamous ‘chengguan’ / Sixth Tone

China’s city management officers, or ‘chéng guǎn’ chéng guǎn 城管, are notorious for violent clampdowns on urban street vendors. But in Chén Wèijūn’s 陈为军 documentary City Dream, the force bites off more than it can chew…

Shot in the central city of Wuhan, the film follows an elderly migrant named Wáng Tiānchéng 王天成 as he mounts a desperate — and ultimately successful — campaign to fend off a squad of chengguan, who have been ordered to shut down his business.

• Social concern for working conditions of couriers deepens
  A Beijing bureaucrat worked as delivery driver for a day and earned just $6 / Caixin
• Féng Dàoyǒu 冯道友
  In China, Atlanta shooting victim’s kin struggle to understand her — and her death / NPR
• Consumer culture
  Reading the leaves of China’s upscale milk tea craze / Sixth Tone
  “Frothy market valuations have driven an explosion in the number of ‘new-style’ milk tea brands in recent years, posing the question: How much fancier can the drink get?”